Glossary · Doing the deal
Good faith
In short
Acting honestly and fairly without intent to defraud or mislead. In a deal, it means all parties are genuinely trying to reach an agreement and fulfill their obligations.
What it means in a deal
You and the seller are expected to negotiate and act in good faith throughout the acquisition process, especially after signing an LOI. This includes transparently sharing information during due diligence. If either party acts in bad faith, it can derail the deal or lead to legal issues.
Related terms
Common questions about Good faith
- Do I need good personal credit to qualify for an SBA 7(a) loan?
- What if my personal debt-to-income ratio is high, even with a good credit score?
- Is an SBA 7(a) loan a good way to buy out a current business partner?
- How does a lender assess 'good character' for all principals on a 7(a) loan application?
- Is an SBA 7(a) loan a good option for someone just starting a brand-new business?
- What if I have a high debt-to-income ratio personally, even with a good credit score?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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